Europe’s industrial strategy faces a growing crisis of dependency. For decades, the continent relied on global markets for copper, lithium, nickel, cobalt, rare earths, and other critical minerals. It assumed globalisation and geopolitical stability would guarantee access. That assumption is now collapsing.
Europe’s Supply Dilemma
The continent faces a stark reality: it cannot rely on China, the United States, or open global markets alone.
-
China: Europe depends heavily on China for processed minerals—over 80% of rare-earth processing, more than 60% of lithium refining, nearly all spherical graphite, and dominant shares in cobalt, tungsten, and battery precursors. This concentration gives China enormous leverage over Europe’s automotive, renewable-energy, semiconductor, and defence sectors. Even minor export restrictions could cause major industrial disruptions. China has already used this approach with gallium and germanium.
-
United States: While the US–EU relationship remains strong, the Inflation Reduction Act prioritises domestic mining, processing, and manufacturing. European companies benefit from subsidies and incentives in the US, which risks a “manufacturing drain” as investment shifts westward. Europe cannot assume American policy will guarantee European mineral security.
-
Global Markets: Resource nationalism is rising across Africa, Latin America, and Southeast Asia. Export restrictions, local processing requirements, and higher taxes make open markets unreliable. Relying solely on imports is increasingly risky.
-
Recycling: Long-term recycling solutions exist but will not meet critical mineral demand. Europe cannot wait.
Closing the Continental Supply Gap
Europe must adopt a strategic, multi-pronged approach:
1. Diversify Global Partnerships
Europe must engage resource-rich nations as partners, not buyers. Co-investment, shared processing, workforce training, and infrastructure support will create resilient, mutually beneficial supply chains.
2. Expand Domestic Mining
Europe’s geology is underutilised. Lithium deposits exist in Portugal, Spain, Germany, France, Finland, and Czechia; rare earths in Sweden; nickel and cobalt in Scandinavia; copper in the Balkans. Responsible development of these resources can anchor domestic supply chains and reduce dependency.
3. Build Processing Capacity
Mining alone is insufficient. Europe must invest in domestic refining, lower industrial energy costs, and establish strategic metallurgical zones. Processing is the critical bottleneck for industrial autonomy.
4. Leverage Regional Integration
Norway, Iceland, the Western Balkans, Turkey, and North Africa can serve as extensions of Europe’s mineral ecosystem. Regional integration strengthens resilience, reduces risk, and enhances supply security.
5. Accelerate Recycling
Recycling of lithium, cobalt, nickel, and rare earths can eventually provide a substantial share of Europe’s needs. Early investment in collection, processing, and innovation is essential to maximise future impact.
Strategic Imperative
The continental supply gap is more than a technical issue—it is a strategic challenge. Europe must secure its own mineral future or risk industrial, technological, and geopolitical dependence.
Europe’s message is clear: the continent must rely on itself. No other power will guarantee its industrial sovereignty.
